How Employee Experience Impacts Customer Experience

Have you ever been to a restaurant where your waiter was running around, stressed out, took ages to get your order at your table, and when he finally got there, he was unfriendly and abrupt?

The issue may not have been the server, but the place they work.

In the digital world, things aren’t much different. And just like you probably won’t feel like eating out at that restaurant again, you’re not likely to be reusing a service where the customer support team didn’t take the time to help you, right?

In the U.S., disengaged employees cost organizations an estimated $450 to $550 billion per year, according to a Gallup report. Successful companies know that delivering great products and customer experiences starts from the experiences employees have at work. But how exactly does the employee experience impact customer experience?

What is Employee Experience?

According to Culture Amp, employee experience is everything surrounding what people encounter and observe throughout their time at an organization.

Specifically, employee experience is a combination of three things:

Culture: Company culture is invisible but has a significant impact on the employee experience. Think of it as the soul of a company, the set of beliefs and behaviors that guide how a company’s management and employees interact with each other and people outside of the organization. Some essential corporate culture features include vision, values, practices, people, narrative, and place.

Tech tools: There are numerous tools for getting your work done, from the project management software that helps you set milestones and assign tasks to chat rooms that send non-stop notifications. Telephones, email services, software…these are all technological tools that exist to help us do our jobs.

Workspace environment: The physical space where you work impacts your productivity more than you think. Having an area where you feel comfortable is crucial if you want to be effective. Now that more people work remotely, the workspace environment is shifting from traditional offices to coworking spaces or home offices.

Over time, there’s been a switch in the importance companies place on the employee experience. It’s no longer that workers are “having to be there” but “wanting to be there.” Companies now realize the benefits of empowering their employees so they can do their best work. According to the Harvard Business Review, things like letting employees have a say in when and where they work report “leaving them more satisfied, motivated, and creative – exactly the sort of employees you need to deliver high performance.”

All companies invest in improving the customer experience. Now, as organizations recognize that people are their greatest assets, they’re focusing on the employee experience, too.

The Correlation Between Customer Experience And Employee Experience

Research studies like Gallup’s “State of the American Workplace” show that satisfied employees are part of the equation to creating happy customers. Not surprisingly, there is a direct correlation between the level of employees’ engagement and the customer experience.

It’s logical to think that happy employees make for satisfied customers, but companies have only recently started putting their efforts into improving employees’ lives. It’s not just common sense – it’s also good for the business.

How exactly does investing in the employee experience pay off? An analysis of over 250 global organizations found that companies that scored highest on employee experience benchmarks had four times higher average profits, two times higher average revenues, and 40 percent lower turnover than those that didn’t.

To cultivate satisfied employees, companies need to promote positive relationships. Fostering a supportive environment, especially during stressful periods, contributes toward this goal.

As the employee experience improves, so will the buyer journey, as employees will be more engaged and empowered to provide help. Overlaying the employee journey on the customer journey can show how these two experiences interact. If you work on improving your employee experience can boost your overall customer experience as well.

Let’s look at ways to use the employee experience to improve your customer experience.

Employee Advocacy

Employee advocacy is the promotion of an organization by its workforce. This relatively new strategy could mean having your employees share information about specific products or campaigns. Or employees using their social media to share what life at a company is like. Any promotion or share of information or brand content helpful for others can be seen as employee advocacy.

A recent study found that employee advocacy benefits companies can positively impact growth and sales because of increased brand awareness and positive perceptions. It can also improve brand reputation as well as employee retention and engagement.

It relates to employee experience because, without engaged employees, it would be impossible to make employee advocacy work. You can’t force employees to be your brand ambassadors – only those that feel identified and engaged with it will do that. As Hootsuite puts it, “for employees to become brand ambassadors, they need to love more about their jobs than just their paychecks.”

Employee Reviews

Let’s go back to our restaurant example. Before going to a new restaurant, you’re likely to have a quick look at their online reviews. A two-star rating? You probably won’t bother eating there.

Customer reviews (and how companies handle both positive and negative customer reviews) are crucial. According to Forbes, consumers perform more pre-purchase research now than ever before. They take a company’s public image into account and look at its core values before buying from that company. Employee reviews, like those on Glassdoor, play a role here because they provide an inside look at company culture.

When a new employee scandal arises, a company’s reputation is extensively damaged and can even affect sales. Complaints coming from employees can be as influential and far-reaching as those coming from customers, sometimes even more so. Listen to employee feedback and, if needed, make the appropriate changes.

Data To Measure Employee Experience

Building a company in which employees feel heard, trusted, and valued takes effort. If you’re interested in improving the employee experience, it’s helpful to set up a few metrics so you can follow your progress and ensure employee satisfaction is on the rise.

Here are some interesting metrics to measure the employee experience:

Performance review surveys: These will help you gather qualitative feedback about each employee. You can then use the data to improve training programs, set up plans for mentoring and promotions, and identify other areas of improvement regarding your employees’ skillset.

Employee net promoter score (eNPS ) surveys: How likely are your employees to recommend your company as an excellent place to work? Encouraging friends and family to work at your business is the highest form of praise. Similarly to NPS, the higher the score, the more satisfied your employees are.

Employment engagement surveys: Measure the pulse of your company culture by collecting data on whether your employees feel motivated and engaged.

Employee Experience Fuels Customer Experience

According to a Deloitte report, MIT research shows that enterprises with a top-quartile employee experience achieve twice the innovation, double the customer satisfaction, and have 25% higher profits than organizations with a bottom quartile employee experience.

Employees matter as much to your customers as to your business. You can’t become a customer-centric business if you’re not considering your employee experience first.

This doesn’t mean you need to ditch your “customer is king” mindset. Instead, consider putting your employees to the same level of importance. It’s simple: an awesome employee experience makes for an awesome customer experience.